JAKARTA (TheInsiderStories) – Good morning. The hike of insured interest rate and the government’s debt auction failed to provide support to the Rupiah on Wednesday (12/09). While the Jakarta Composite Index ended on the red as investors stayed away from equity market.
Indonesia Deposit Insurance body, has raised insured interest rates on Rupiah-denominated savings by 25 basis points to 6.50 percent, effective today, its Chairman Halim Alamsyah said yesterday. The agency also raised insured interest rates on dollar-denominated deposits by 50 bps to 2.00 percent.
At the same day, the government raised Rp16.2 trillion (US$1.11 billion) from auctions of bills and bonds. The government received bids amounting Rp36.9 trillion, lower than Rp59.3 trillion of bids in the debt auction on August 28. The lower demand in the debt auction was negative for tge market while the equity market remained turbulent due to external headwinds.
Meanwhile, the Rupiah ended down at 14,863 per US$1 from 14,835 per US$1 on Monday. The Jakarta Composite Index also fell 0.6 per cent to 5,798.
Same situation hampered the crude oil price. Yesterday the crude oil price was near its highest level in 2018 due to a drop in United States inventories and worries over falling supplies from Iran due to economic sanctions.
Go to other issues, the State Owned Enterprises (SOEs) ministry continued with management revamp at SOEs. After changes at state owned gas distributor PT Perusahaan Gas Negara Tbk (IDX:PGAS), the government replaced the president director of flag-carrier PT Garuda Indonesia Tbk (IDX: GIAA) Pahala Mansury with Ari Askhara, previously chief executive of state port operator PT Pelabuhan Indonesia III.
However, despite a slew of domestic developments, investors will keep an eye on the European Central Bank meeting and seeking cues on its plan to reduce its quantitative easing program, which is set to end by end of 2018.
Not much happening from the political side today, except some vague move by the opposition camp on the so-called “55 campaign strategy”, which was revealed during the meeting between presidential candidate Prabowo Subianto and former President Susilo Bambang Yudhoyono.
Hope you have a profitable day.
TIS Intelligence Team, Email: email@example.com